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Dew Briefs:
- SK On is a battery unit of South Korean energy group SK Innovation, which supplies electric vehicle (EV) batteries to Ford, Hyundai and Volkswagen among others
- The biggest challenge is cost, charging time and efficiency
Europe faces a risk of relying too heavily on Chinese electric-car batteries, as European automakers plan to increase imports of affordable Chinese batteries.
UBS analysts predict that Chinese battery companies’ market share in the EU will rise from 30 percent to 50 percent between 2023 and 2027, while South Korean companies’ share is projected to decline from 60 percent to 40 percent.
European governments are working to address this issue, as they believe the current situation cannot continue. European investments are primarily going towards inexperienced local newcomers, while Korean battery companies are not expanding their European capacity investments due to more attractive subsidies in the US.
This is creating a supply-demand gap that is likely to be filled by Chinese exports. China’s CATL and BYD are the leading providers of EV batteries, followed by South Korean competitor LG Energy Solution and Japan’s Panasonic.
SK On, the world’s third-largest non-Chinese supplier, is expanding its operations in Hungary to help European car manufacturers meet EU legislation requiring 90 percent of EV batteries to be produced locally by 2030.
